What is the appropriate accounting treatment for the initial value assigned to in process research and development acquired in a business combination?
What is the appropriate accounting treatment for the value assigned to in-process research and development acquired in a business combination? Capitalize as an asset.
What is goodwill in accounting quizlet?
Goodwill is the excess of the fair market value of the entity as a whole over the fair market value of its identifiable assets.
Which of the following is the best theoretical justification for consolidated financial statements quizlet?
Which of the following is the best theoretical justification for consolidated financial statements? In form the companies are separate; in substance they are one entity.
What is pushdown accounting quizlet?
What is push-down accounting? a. A requirement that a subsidiary must use the same accounting principles as a parent. company.
What is the accounting for goodwill?
Goodwill is calculated by taking the purchase price of a company and subtracting the difference between the fair market value of the assets and liabilities. Companies are required to review the value of goodwill on their financial statements at least once a year and record any impairments.
Is goodwill A accounting principle?
In accounting, goodwill is an intangible asset that arises when a buyer acquires an existing business. Goodwill represents assets that are not separately identifiable.
When should a consolidated entity?
Consolidated financial statements are used when the parent company holds a majority stake by controlling more than 50% of the subsidiary business. Parent companies that hold more than 20% qualify to use consolidated accounting. If a parent company holds less than a 20% stake, it must use equity method accounting.
What is pushdown accounting?
Pushdown accounting is a method of accounting for the purchase of another company at the purchase price rather than its historical cost. The target company's assets and liabilities are written up (or down) to reflect the purchase price.
When a parent subsidiary relation exists consolidated financial statements are prepared in recognition of the accounting concept of?
1. When there is a parent-subsidiary relationship, preparation of consolidated financial statements are performed in recognition of the accounting concept related to economic entity. Hence option d is correct.
Which of the following are descriptive of goodwill impairment accounting under IFRS?
Which of the following are descriptive of goodwill impairment accounting under IFRS? Goodwill is tested for impairment using a one-step approach. Goodwill recognized in a business combination is allocated across cash-generating units expected to benefit from the business combination.
When a business combination results in a bargain purchase gain which of the following best describes the valuation basis of the acquired firm?
Terms in this set (35) When a business combination results in a bargain purchase gain, which of the following best describes the valuation basis of the acquired firm? The collective fair value of the net identifiable assets acquired.
Which of the following best describes a situation where one company acquires the net assets of another firm and the acquired firm then is dissolved as a separate legal entity?
A single set of combined financial statements for multiple companies tied together through common control. Which of the following best describes a situation where one company acquires the net assets of another firm and the acquired firm then is dissolved as a separate legal entity? Subsidiary acquisition.
MULTIPLE CHOICE – THEORIES
At the date of an acquisition which is not a bargain purchase, the acquisition method a. Consolidates the subsidiary's assets at fair value and the liabilities at book value b. Consolidates all subsidiary assets and liabilities at book value c. Consolidates all subsidiary assets and liabilities at fair value d.
34.
Which of the following statements is false regarding push-down accounting? a. Push-down accounting simplifies the consolidation process b. Push-down accounting provides better information for internal evaluation c. Push-down accounting must be applied for combinations under a pooling of interests d.
